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Shopping for Insurance OLD VERSION LAID TO REST SEPT. 2013

Here is the entire archive of our handbook for people who are uninsured.

We’re planning to publish several articles in this series, much as we have started publishing our “Ways to Save” series, then archive them here on the site.

 

Part 1: Helpful hints
Part 2: The options
Part 3: A range of choices
Part 4: Subsidized options
Part 5: How do I decide?
Part 6: What to look for
Part 7: Losing insurance after divorce? Maybe you don’t have to

 

Part 1: Helpful Hints

Let’s define the problem: The  Census Bureau says 50.7 million  Americans had no health insurance in 2009, making up about 16.7  percent of our country’s population.

In 2009, nearly 9 million children under the age of 18 were uninsured, while some 15 million young adults ages 19 through 29 were uninsured. A survey published recently by the Commonwealth Fund, a private foundation that aims to promote a high-performing health care system, found that 45 percent of young adults said they delayed or  went without needed medical care last year, and 39 percent said they had problems paying medical bills.

People go without health insurance for many reasons. It could be the cost of coverage. Maybe it’s the complexity of choosing a provider.

People who are uninsured make a wide range of choices and arrangements to get care, but generally they tend to skip preventive measures and delay treatments when possible. They are also at a much greater risk
for falling deeply into debt in the case of a medical emergency. As we’ve learned in our reporting about the costs of medical procedures, a trip to the hospital or emergency room without insurance can result in thousands upon thousands of dollars worth of charges.

We designed this guide to help uninsured people understand how the system works and what resources are available. It’s intended  to help people who have no knowledge of insurance, and people who have some knowledge. We’ll try to be clear and to the point.

The first thing to know about insurance that it varies from plan to plan, state to state, so much so that it sometimes seems impossible to navigate. Health insurance is a blanket term used to describe any insurance that offsets the cost of medical procedures, hospital visits or prescription drugs. Without any sort of plan, you’ll be solely responsible for the costs when you visit the doctor or the hospital.

Because health insurance is administered on a state-by-state basis, there are many options. But first you need to know what you’re looking for. Providers and plans may vary depending on where you live. Also, states have different rules and regulations.

The following information is specific to New York; your state may be similar, or it may vary. Here are nationwide statistics on the uninsured, and New York statistics on the uninsured, from 2008, given by researchers at the Kaiser Family Foundation.

Regulations:

 

New York state prohibits insurance providers from denying an individual coverage because of preexisting health conditions.

By law, all insurance providers must also offer “family plans”: insurance packages that cover not only individuals, but also any children under 18.

New York State prohibits insurance providers from denying an individual coverage because of preexisting health conditions. However, if the you’ve been uninsured for 63 days prior to signing up for coverage, any insurer is permitted to investigate your medical records dating back six months and deny payment for any claims related to that particular condition for up to twelve months. A sure-fire way to avoid this is to make sure you’ve got creditable coverage.

Creditable Coverage: This is a term generally used to describe coverage an insured person has before enrolling in a new plan. Coverage is considered “creditable” if it hasn’t bee interrupted for more than 63 days.  It’s important to have because, if you’re on an insurance plan, then join another with a lapse less than 63 days, your new policy cannot subject you to any pre-existing condition exclusions. This is less important for states like New York, which are prohibited from excluding anyone based on a pre-existing condition, but in many other states, making sure you have creditable coverage is crucial.

 

 

Part 2: The Options

The best way to start shopping for insurance is to know your options. The world of insurance can seem bewildering, so let’s define the terms.

Catastrophic: Catastrophic health insurance is not full medical coverage. Instead, it provides coverage for emergencies—car crashes, serious illnesses that result in hospitalization or an emergency room visit, etc. It’s widely considered to be a low-cost alternative to an actual full health insurance plan.

High-deductible: A high-deductible plan has higher deductibles, meaning the amount you must pay before your insurance company will cover your costs, and lower premiums, meaning the monthly fee you pay to your insurance company. You pay less each month, but have to pay more before your insurance kicks in.

Low-deductible: This plan will cost you more each month, but your insurance company will reimburse more of your costs, should you need to visit a doctor, buy prescription drugs or go to the hospital or emergency room.

Family Plan: Some insurance plans also cover children of the insured person or the spouse, or both spouse and children. There are a variety of options.

Other useful terms:

HMO: HMO stands for  Health Maintenance Organization. This type of insurance plan is comprehensive; the HMO arranges for insurance through its own group of contracted doctors and health care professionals. It involves a premium payment. Additionally, there is a co-pay for all doctor’s visits, but it can be relatively low—something like $5 and up.  You must stay within your network to be covered. If you go out of network, costs can rise fast; typically you pay the full cost of out-of-network care.

PPO: PPO stands for Preferred Provider Organization. The providers in  the network have agreed to provide care for a contracted rate. When you visit a participating doctor, you’ll present a card, and most of your bill will be covered. Like an HMO, co-pays are usually required under this plan, with the co-pay generally either a set fee ($20 or $30) or a percentage of the bill. If you choose to go out of network, you’ll pay more: most plans have an out-of-network deductible, which you must pay, and then you are responsible for paying some part of the provider’s bill. Going out of network can be very expensive; the reimbursement rate depends on your coverage, but it’s typically higher, maybe considerably higher, than your network’s contracted rate.

POS: Point of Service plans are a combination of HMO and PPO. You decide whether to stay in network or go out. Insurers set the networks, and the co-pay works very much like an HMO or PPO. When you go out of network, typically you have to pay the full amount up front, and then submit the bill for reimbursement. The reimbursement rate depends on your coverage, but it’s typically higher, maybe considerably higher, than your network’s contracted rate.

EPO: Exclusive Provider Organization plans function like a PPO with one big difference: if you go out of network, you typically pay the entire cost yourself.

In-network vs. out-of-network

An in-network doctor is a provider who is under contract by your health insurance company to be accept an agreed-upon or negotiated rate  for the cost of the visit. An out-of-network doctor is one who is not contracted, and thus will charge a patient full price.  It’s important to know what doctors, hospitals and clinis are in-network so you don’t have  to pay the full rate out-of-pocket.

Why go out of network?

A patient might seek out-of-network care in the event of a medical emergency that necessitates immediate care from whatever doctor, hospital or clinic is close by. Alternatively, a patient may choose to use a primary-care doctor or other specialist who’s not in the insurance company’s network.

For many insured people, when their plan changes, they may find that a doctor or hospital they have been using is suddenly out of network, or a doctor or hospital may stop accepting a certain kind of insurance. It pays to ask. Every time.

Out of network doctors at in-network hospitals:

Unfortunately, it happens: A patient visits a hospital or clinic that is considered by the patient’s insurance company to be in-network, but  a provider who is considered out-of-network is supplied. (Anesthesiologists are often the topic of such misunderstandings.) The results can be devastating for the patient, who may be forced to pay the full out-of-pocket cost of the visit. This problem is prevalent in New York, and in 2009 then-Attorney General Andrew Cuomo launched a reform campaign to help consumers understand the costs of out-of-network coverage.

For more information and further reading:

http://www.healthcare.gov/compare/index.html

http://www.fairhealthconsumer.org/resources.aspx

Other options for uninsured adults and families in New York:

The health insurance you’re eligible to receive can sometimes depend on factors like your age and your income, or your profession, and it’s important to know where you fall.

If you’re under 26, you could be covered:

 

As part of the 2010  federal health reform bill, if you’re under 26, you are eligible for coverage under your parents’ plans if they have health insurance. The law includes insurance plans already in place — meaning if your parents already had health insurance at the time the law was approved, and you’re under 26, you’re eligible  for coverage. Read more here.

 

 

Part 3: A Range of Choices

Shopping for insurance can be baffling.  But it follows most of the same rules you follow in any consumer endeavor: Inform yourself. Ask questions. Read the small print. Be sure you know what you’re getting.

If you’ve lost your health insurance, or are low-income, you may be eligible for one or more of the following:

Healthy New York: Part of Empire Blue Cross Blue Shield, Healthy New York is a viable insurance option for low-income New Yorkers. Many sole proprietors are eligible. There are several plans under the Healthy New York umbrella, including packages for individuals and families, based on income. Read more  on New York State’s insurance website.

COBRA: The Consolidated Omnibus Budget Reconciliation Act gives workers and their families who lose health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost to the plan. COBRA can be an expensive option, but it’s a sure thing. Read more about on the website for the U.S. Department of Labor.

Group Health Incorporated: The largest nonprofit health insurance provider in New York, GHI has a range of health  plans for individuals, families and small businesses. Group Health Incorporated also has several options for low-income New Yorkers, including a partnership with Healthy NY and Medicaid. Learn more at MedHealthInsurance and at Vista Health Solutions.

Options based on profession

 

The type of health insurance plan you’ll choose depends on pretty much everything, and that includes your  profession. If you’re employed full-time, your place of employment may offer health coverage. Many working New Yorkers are either freelancing or self-employed. Below are a range of  options.

Pre-existing conditions: If you’ve got pre-existing medical conditions that may prevent you from becoming eligible for other health insurance plans, New York offers a program called NY Bridge Plan. More information can be found on GHI’s website.

Student Insurance: Many colleges and universities offer health plans for their students. For many full-time students this may be the easiest, cheapest and most practical option. The services will often be performed at the campus’ medical center or an affiliate, and may cost more if you choose to see a doctor off-campus. If you are a college student, contact your school for information about options.

Freelancers: Freelancers Union, a support platform for freelance writers, artists and entrepreneurs, offers several different  health insurance plans, including both high and low deductibles. You’re eligible for health insurance if you are a freelancer, sole proprietor, independent contractor, consultant  or temporary worker, or are self-employed or employed part-time. Here’s the breakdown of insurance plans offered by Freelancers Union.

Artists: Artists are eligible for health insurance coverage through several different avenues. Fractured Atlas is a non-profit dedicated to providing low-cost health insurance coverage to artists and those working in the creative industry. Find out more on their website.

Unions: Those working in the entertainment industry — actors, theater technicians, filmmakers — can often join unions that have  health insurance plans. Examples: the American Federation of Theater and Radio Arts,  the Actors Equity Association, the Screen Actors Guild and American Federation of Musicians Local 802.

These unions often require members to have worked a certain number of union hours, or earned a certain amount of money working a union job, in order to qualify. If you already belong, check out your union’s website for other health insurance coverage options.

Small businesses

If you own a small business, you might want to pick  a group coverage plan for you and your employees. A small business is defined as a business employing 2-20 employees, on average. Some plans aren’t available for sole proprietors, some are; some limit coverage to employers of 50 or fewer people.

In New York City, the Chambers of Commerce in four of the five boroughs offer health insurance for small businesses.

The Manhattan Chamber of Commerce, in partnership with Atlantis Health Providers, includes Freedom or Liberty networks, out of network coverage and no referrals to see specialists. Visit the website for more information

The Brooklyn Chamber of Commerce, in partnership with Group Health Inc., offers small businesses two different low-cost insurance plans called Brooklyn Health Works. For more information, check the website

The Bronx Chamber of Commerce, in partnership with Aetna, Atlantis and United Healthcare-Oxford, offers small businesses a range of low-cost health insurance plans. For more details, click here

The Queens Chamber of Commerce, in partnership with Aetna, Freedom-Oxford, MVP and Empire, offers a variety of  health care packages for small businesses. Read more  here.

For more information:

http://www.healthcare.gov/compare/index.html

http://www.fairhealthconsumer.org/resources.aspx

 

Part 4: Subsidized Options

You may not want to think about this, but depending on your income, the best low-cost insurance for you in New York State may be a government-subsidized health insurance program, offered through the state of New York (this handbook is state-specific, though some information may translate easily to other states; our health-care system’s state-by-state regulation brings complexity to this task). If you’re not sure whether you’r eligible, here’s a quick and easy screening tool to make things a bit easier.

Among the options available:

Medicaid: The leading health care option for Americans who cannot afford coverage. You may qualify for Medicaid if your household income is below the poverty level of your state, if you have especially high medical bills, if you claim Supplemental Security Income or Temporary Assistance for Needy Families benefits. Find out more information about the various ways Medicaid can help.

Medicare: If you’re over 65, you may be eligible for Medicare, a public program available for senior citizens. If you are disabled and under the age of 65, or have certain serious illnesses, you may be eligible for Medicare as well.  Read more about the program and eligibility requirements. **

Healthy New York: Part of Empire Blue Cross Blue Shield, Healthy New York is a viable insurance option for low-income New Yorkers. Given the state of the economy and the job market, many sole proprietors are eligible. There are several plans under the Healthy New York umbrella, including income-based packages for individuals and families.

Family Health Plus: a public health insurance program, offered through the Department of Health, for adults between the ages of 19 to 64 who have income too high to qualify for Medicaid. Family Health Plus is available to single adults, couples without children, and parents who are residents of New York State and are United States citizens or fall under one of many immigration categories. Family Health Plus provides comprehensive coverage, including prevention, primary care, hospitalization, prescriptions and other services. There are minimal co-payments for some Family Health Plus services. Health care is provided through participating managed care plans in your area. Learn more about whether or not you qualify, and how to enroll.

Child Health Plus: A health insurance plan designed for children in low-income families. To qualify, children must be under the age of 19 and live in New York State. Find out more about eligibility and premiums.

For more information:

http://www.healthcare.gov/compare/index.html

http://www.fairhealthconsumer.org/resources.aspx

 

Part 5: How do I decide?

You may want to think about doing your own research — and also using a broker to help you sort through the choices.

Of course, don’t forget the basics: The insurance business works by pooling risk. The insurer estimates the total potential cost of insuring a group of people (in a business, in a union, for example), then establishes income that will be counted against that cost in the form of premiums, co-pays, deductibles and the like. The total amount of money taken in needs to surpass the total amount of money paid out.  Insurance companies exist to move money around, and they commit in their contracts to make sure the money is available to pay the benefits specified in a contract.

Many individuals find insurance plans on their own, by recommendation of a friend or colleague (see resources in this series), but because of the complexity of the process, some choose to consult a professional. An insurance broker can help with many tasks:

  • Help you evaluate your health insurance needs
  • Explain details of the different plans
  • Offer specific recommendations
  • Review your plans periodically and explain any changes that have occurred
  • Advise on claims dispute resolutions and insurance regulations.

Here are a few things to keep in mind while you shop for the right broker:

  • Keep yourself informed. Brokers sell health insurance plans for several different companies, while agents work for a single company. Brokers can offer an array of plans, but like agents, they work on commission, so as a consumer it’s important to be discerning, and gather as much information about each plan as you can.
  • Ask for referrals from your friends, family, co-workers — people you trust. It’s always better to work with someone whose track record is proven.
  • Research your broker: you can do a quick internet search of your broker to find out more about him or her, or you can check an agent or broker’s disciplinary record by calling the insurance commissioner’s consumer hotline. For brokers operating in New York, you would call the Albany office at (518) 474-6600, or go to the Web site at http://www.ins.state.ny.us/nyins.htm.

Consult online resources. Here is a list of Web sites that aid consumers in their search for health insurance brokers. One thing to recognize when consulting services like these is that they are for-profit enterprises, meaning that the agent working with you will receive a commission for each policy he or she sells a consumer. That said, the brokers are knowledgeable and understand how insurance works.

Consumer sites including these can help

We talked to Nate Purpurra of Ehealthinsurance.com about some of the most important things to keep in mind when shopping for an insurance plan, and what kinds of mistakes consumers often make.

“First thing we tell people is, know the rules of your state,” he said. “The next thing is don’t let a pre-existing condition deter you from trying to get insurance. We’re always calling in customer stories. We had …  a recent college graduate with asthma. She was sure she wouldn’t qualify for department

insurance. We produced a whole list of conditions that are not always going to get you declined. Insurers tend to have leniency.

“The third thing is, individual insurance is the tapas menu, while a group insurance plan is an all-you-can-eat buffet. With individual plans you have to make sure the benefits you want are part of the plan. Like prenatal, mental health, prescription drug benefits. You need to pay attention to that kind of thing. A lot of these rules change in 2014, when health reform gets fully implemented. The guarantee issue goes away — at  that date, if the court doesn’t change it, there will be a mandate that people buy coverage, and there will be no denying patients for preexisting conditions.

You also have to be careful that the benefits you need and want are on your plan. It is particularly important for women to know that individual health insurance plans don’t automatically cover maternity benefits. Some plans may not cover prescription drugs or only cover generic drugs, and benefits like chiropractic care or mental health coverage are not automatic.

“There are 8 states that require health insurance plans to provide maternity coverage; Montana, Colorado, New York, New Jersey, Massachusetts, Oregon, Washington and Vermont. And, there are 11 states that require men and women to pay the same amount for health insurance, which is generally referred to as ‘gender rating.’ California, Oregon, Washington, New York, New Jersey, Massachusetts, Vermont, Minnesota, New Hampshire and Montana do not allow insurers to gender rate in the individual insurance market.

“Creditable coverage is a big issue. If you want to avoid a gap in coverage, you want to make sure you’re buying creditable coverage. It’ll provide you discounted access to a network of physicians. You don’t want to buy a limited benefit plan that has a low cap on what they’re going to cover. Short-term health insurance plans don’t have these caps, but they don’t qualify for creditable coverage. It’s inside baseball stuff, but I encourage people to apply for a major insurance policy. You don’t want to bust out your discount insurance plan and get hit with a $25,000 bill because your insurance will only cover $2,500.

“Discount health plans may provide discounts on medical services or provide limited coverage for specific benefits like doctor visits and prescription drugs, but they do not generally meet the criteria for ‘creditable coverage.’ Additionally, be cautious of so-called ‘low cost’ options that promise that anyone will qualify. Either of these may leave you with big bills to pay in the case of a major hospital stay or medical emergency.

“Limited benefit plans typically have very low limits on the amount of coverage they’ll provide for overnight stays in the hospital or trips to the ER. Some plans have caps as low as $2,500, which is why it’s critical   that you read the fine print or work with an agent licensed in your state.  eHealthInsurance does have a U.S.-based 24/7 call center staffed with agents licensed in every state. Don’t assume that everything is covered. Research plans online and talk to a licensed agent to educate yourself. Doing a little bit of homework now will save you a lot of money later.”

*  *  *  *  *  *

Part 6: What to look for

Because there are so many different insurance plans offering different types of coverage, it’s important to look at each plan with a critical eye, and read all the fine print.

Most important: If you have questions, ask. Elements of your plan that are especially important are:

  • Your network: It’s crucial to understand how much you’ll be charged if you go out-of-network.
  • Your deductible: Are you more comfortable paying a higher monthly rate and lower co-pays, or the opposite? How much will your co-pay be for a standard doctors visit?
  • What your plan includes: Is there coverage for specialized care? Will your plan cover things like check-ups and preventative doctors visits, in addition to emergency room visits?
  • Out-of-pocket limits: This is the amount your provider can require you to pay out-of-pocket, and it’s an important number to know.
  • Non-covered services: Especially if you require specialized medical care, you should look at what services are and are not covered under your plan.

 

To make it easier, you can make a plan-comparison chart like this one, found at www.fairhealthconsumer.org:

Type of Plan What Does it Mean? Co-payments Deductible Co-insurance
Health Maintenance Organization (HMO) Your primary care physician coordinates your care, and refers you to a specialist if needed. You must use in-network providers, except for emergency care. Yes Sometimes, such as special services like hospital stays Sometimes
Preferred Provider Organization (PPO) You can visit any provider without a referral, either in or out of your network, but you may pay more for out-of-network care. Sometimes Yes Yes
Point-of-Service Plan (POS) Your primary care physician coordinates your care, and refers you to a network specialist if needed. You can choose to go to an out-of- network specialist, but costs for out-of-network care may be higher. Yes Yes, higher for out-of-network providers Yes, higher for out-of-network providers
Exclusive Provider Organization (EPO) You can get a referral from your PCP or you can go to a network specialist without a referral.  You must use in-network providers, except for emergency care. Sometimes Yes Yes

 

 

 

 

Type of Plan What Does it Mean? Co-payments Deductible Co-insurance
Health Maintenance Organization (HMO) Your primary care physician coordinates your care, and refers you to a specialist if needed. You must use in-network providers, except for emergency care. Yes Sometimes, such as special services like hospital stays Sometimes
Preferred Provider Organization (PPO) You can visit any provider without a referral, either in or out of your network, but you may pay more for out-of-network care. Sometimes Yes Yes
Point-of-Service Plan (POS) Your primary care physician coordinates your care, and refers you to a network specialist if needed. You can choose to go to an out-of- network specialist, but costs for out-of-network care may be higher. Yes Yes, higher for out-of-network providers Yes, higher for out-of-network providers
Exclusive Provider Organization (EPO) You can get a referral from your PCP or you can go to a network specialist without a referral.  You must use in-network providers, except for emergency care. Sometimes Yes Yes

 

 

Other things to consider:

 

  • Do you have a primary care physician already, and is he or she on your plan? What networks does he or she belong to?
  • Have questions you don’t know how to answer? Consult the Better Business Bureau.
  • Consult the National Association of Insurance Commissioners, an organization designed to educate and protect consumers, and regulate insurance companies in any given state:
  • The New York State Insurance Department’s health insurance page for consumers.
  • Insurance brokers discuss various plans at several on-line forums, like this one. You might try going there and looking for information about a plan you’re thinking about buying, or a company you’re considering.

Part 7: Losing insurance after divorce? Maybe you don’t have to

People lose insurance coverage for all sorts of reasons: a job loss, the simple act of turning 27 years old, or a spouse’s job loss.

One of the knottiest problems is divorce, which can bring a seemingly unending, and unexpected, list of traumas — among them the loss of health insurance for a dependent spouse.  ”Roughly 115,000 American women lose private health insurance annually in the months following divorce and roughly 65,000 of these women become uninsured,” according to a study by the Journal of Health and Social Behavior from Nov. 12, 2012.

This doesn’t have to be the case. For married couples in New Jersey and some other states, Limited Divorce, also referred to as Divorce from Bed and Board (the statute is here: N.J.S.A. 2:34-3), is a legal separation, which basically means the two remain married but for all intents and purposes, they are  legally
separated, and are living separate lives. New York also recognizes legal separation (that information can be found here).

Some states recognize this, but not every employer does. Check with your employer, or that of your spouse, if you are dependent. Some corporations  recognize Limited Divorce and  will continue to cover the separated spouse under the existing plan, at no penalty to the employed spouse. The employed spouse or the dependent spouse should contact the benefits administrator at work and at the insurance company, to get full information on whether or not the employer recognizes limited divorce, and any terms and conditions. The laws vary by state; while some states, including Delaware, Florida, Pennsylvania and Texas, do not recognize legal separation, there are variations in the definition which could still include health care coverage for the separated spouse.

This is an option to consider, if even just for the short term, beyond COBRA, which under federal mandate, allows the unemployed spouse the right to continue the existing group health coverage for a specific period of time, but at his or her expense. This can be too expensive  for many people, as it means coughing up 100 percent of the cost of the premium, plus administrative fees.

One caveat – read the fine print on the corporation’s group health plan, and look for the section that lists “Legal Separation or Divorce,” as a “Qualifying Event.” This will outline limits to the length of coverage,  which can range from one year to three years.

We got a hold of Lashanay C., a health guide for Blue Cross Blue Shield of Minnesota, who explained this further by saying many employer-based health insurance plans are underwritten by COBRA. She explained that when this is the case, regardless of how long a couple is continuing a limited divorce, the uninsured spouse will only be covered for a maximum of 36 months from the date the policy goes into effect.

We’re not sure if there is more to this than what we’ve found. Further research has suggested that, while the law varies from state to state, it appears regardless of how long a couple remains in a limited divorce, the policy is: employer-issued health insurance will run out for the dependent spouse after three years, even if absolute divorce isn’t on the horizon.

It can be overwhelming for the dependent spouse to ask the right questions of the employer, especially if the relationship with the husband or wife is not amicable. But the two are not mutually exclusive, and the dependent spouse is protected under the United States Department of Labor’s Employee Benefits Security Administration. Here are answers to some FAQs, and the toll-free number to call with any specific questions you may have about coverage and your rights: 1-866-444-3272.

Do you have anything to add? Let us know at info [at] clearhealthcosts [dot] com.